Current and prospective federal contractors that violate employment laws could be barred from doing business with Uncle Sam if new proposed rules from the Department of Labor go through.
On May 27, the DOL issued proposed guidance that would require federal contractors and bidders for federal contracts to discloseviolations. The new rules would allow government contracting officers to reject bids and cancel existing contracts based on past violations—even if those issues have already been resolved or adjudicated.
“The opportunity to contract with the federal government is a privilege, not an entitlement. Taxpayer dollars should not reward corporations that break the law,” said U.S. Secretary of Labor Thomas E. Perez.
The rulemaking resulted from an executive order that President Obama issued last July. The Fair Pay and Safe Workplaces Executive Order requires prospective federal contractors to disclose labor law violations and directed federal agencies to develop guidance on how to consider violations when awarding federal contracts.
Under the order, contractors must report any administrative merits determinations, civil judgments or arbitration awards rendered against them during the preceding three years for violations of any of 14and executive orders or equivalent state laws.
Disbarment from federal contracting could result from violations or alleged violations of a variety of laws regulating wage-and-hour, discrimination, harassment, retaliation,and child-labor practices.
A trio of the government’s largest contracting agencies—the Department of Defense, the General Services Administration and NASA—also issued proposed regulations integrating the provisions of the DOL guidance into their existing procurement rules.
The public has 60 days to offer comments on the proposed guidance.